Intel's new CEO shakes things up

Brian Krzanich outlines re-org in internal memo two days after taking the helm of the world's biggest chip maker.

Newly minted Intel Corp. CEO Brian Krzanich wasted little time putting his stamp on the company he has worked for for more than 30 years. After officially being handed the reins at Intel last week with the retirement of Paul Otellini, Krzanich sent out an internal memo Monday outlining some pretty significant structural changes.

The memo—which has not been released externally—was reported Tuesday (May 21) by the Reuters news service and other organizations. Intel spokesman Chuck Mulloy confirmed the existence of the memo and walked through the highlights of the structural changes to EE Times.

Mulloy said he has heard from people outside Intel that they were surprised by how quickly Krzanich moved to shake things up. He characterized the swiftness as typical of Krzanich's personal style. Mulloy said Krzanich made it clear during last week's Intel shareholder meeting and in subsequent interviews that he is a man of action more than a man of words.

"He's not much for talking about what he's doing. He's more about doing it," Mulloy said.

The structural changes—which call for more of Intel's groups to report directly to the CEO—are designed to shorten lines of communication and put Intel in position to move more quickly, Mulloy said. The changes support Krzanich's four overarching goals—to continue driving sales of PC processors, move aggressively into mobile computing, accelerate growth in the data center market and continue Intel's leadership in chip manufacturing technology, Mulloy said.

"It's about moving quickly, being decisive, identifying markets sooner and moving more quickly to be there," Mulloy sad.

The memo also apparently cleared up an issue that may have been misperceived in some corners. Renee James, Intel's newly appointed president, reports to Krzanich. "She works for him," Mulloy said. "It's not two in the box."

Some had taken Intel's appointment of a president along with naming Krzanich CEO as a sign that the two would share power over the company. But Mulloy noted that James is not the first president in Intel's history—the company simply did not have the position over the past eight years because Otellini never appointed one.

re-arrnage, organize, play tough, all good and good American Business practise.
Some measurable goals are good.
Silvermont and future cellphone SOCs taking 30,40.. % of the market by such and such date.
Limit ARM to leass than 5% in all server markets
Home, internet of things and other markets..
Keep margin same on ultrabooks...
who would own what and when do we see streets belive in the talk..

na, this won't help either. in the end goal will miss, the reason is .... anything but my responsiblity.
samsung/huawei etc has developed a more comprehensive system to tackle this.
americans might never want to learn it.

Agreed. I'm not surprised at how fast he's moving. He had to know he was a potential CEO candidate, and one thing I'm sure he's been doing in recent years is making a list of changes he'd make if he got tapped for the position. Now he's the CEO, and is starting on making those changes.

It is clear that this is what the shareholders wanted to hear, and the CEO who ignores what those demanding short term profits ask for is likely to be replaced. Fortunately he is smart enough to understand that being a leading seniconductor producer is still a very good place to be. Mobile computing is very fickle, PC processors may or not continue to be a smaller market and getting smaller, and data centers do need some ways to use less power. So the other three make some sense as long as he does not waste resources.

ie. one major US semi company's ceo dragged a group of his operator friends to senior management role.
they might be good guys, but dumb indeed.
anyway, they can promote their dog to be a vp literally. dog has many virtue anyway.

some folk think Krzanich's education sucks.
but who cares. How is he got picked among competitors? there is no exam, test, competition. all that matters is the board like him. why? maybe because he is dumb and won't make the board members looks stupid.

This discussion of Krzanich's education seems not only elitist, but downright silly. The man has been working at Intel for more than 30 years, many of those in very senior positions. Whatever he learned or didn't learn in chemistry 101 at SJSU is irrelevant.

Dylan,
I don't see any discussion, just a troll "sprite0022" spewing out stuff. I've been noticing this "sprite0022"'s comments and they are mostly anti everything so far, but I suspect we'll soon here a leap into pro-China soon. That's what a human commenting engine does. Sharp, divisive, slow, soft and corrupting opinions ever slowly, dida dida dida... :- )

Good one Dylan! That type of cynicism has no place here. Some of my best teachers in the industry have been technicians with NO degree, not PhD's!
I think the changes should be given enough time to take effect and produce results at Intel.
MP Divakar

If he has been at Intel 30 years, he graduated before degrees *existed* in most of the subjects of his employees' degrees. So what? The bigger question is, what has he been doing for the last 3 to 5 years?

One big change seems to be downgrading of Perlmutter's position. "After Perlmutter transfers his business groups, he and Krzanich will "define his next significant contribution at Intel," according to the email described by the source."
Hmm... Basically he has his chair taken from under him, with no replacement in sight.

The comment in question has been removed. We appreciate that everyone is entitled to their own opinion and are happy that you are willing to share them on EE Times, but we cannot tolerate racism in any form.

the problem with appointing a long term Intel inside is that Intel will keep being Intel... when it desperately needs to morph into a combo of Samsung, ARM, Broadcom and Intel ... but Intel just doesn't get it. Outside of x86 they have failed at every turn, and predictably so.

"Outside of x86 they have failed..." And how many x86 PCs is the world still buying every day? I agree it would be good to get some of their eggs out of that one basket . . . unless they believe in the advice to "watch that basket"!

Amazing, if we belive Intel is two years ahead of TSMC on manufacturing and yet cannot penetrate cell phone means...
1. x86 needs to morph more towards RISC (happening but legacy will not allow..)
2.or x86 is not bad but no clue of SOC design
3.we do undertand both, but our engineers need a referesh course...

Rick,
Right on ! Having 22nm and 2 years ahead in some factory in Oregon does not count if you don't ship 22nm Atoms chips to market.
AMD is now shipping 28nm Temash (AMD's version of Atom).
28nm Temash smokes Intel's current shipping atom but Ohhh I forgot Intel is 2 years ahead :)

@dylan, sjsu's problem is not it's chem101 quality. why ppl want their kid go to harvard instead of sjsu, 1)it offers better class 2) it's a sign that their kids is smart. (GPA, SAT etc.) Krzanich's SJSU diploma means either 1) his dad was poor, 2) he suck at GPA, SAT etc, dumb maybe.
just same as when you hire a lawyer in a murder case, you want a harvard graduate instead of a SJSU one.
this is one of the important indicator of one's capability, take it or not.
stay away from intel stock if you are smart.

hmm, your comments make me think even Steve Jobs would not be a good fit to be a CEO ...
At least, BK has the credibility that the manufacturing group under his lead is two years ahead of the rest in the industry. Architecture (x86) and manufacturing (process) groups are the two most valuable assets. It is too risky for an outsider to manage both groups as CEO. Who knows the next CEO can be good or not if from outside. A not-well-fit CEO can bring down the giant quickly like Nokia. Intel's culture is also a different one. In history, Eric Kim(not CEO but 2nd rank) unsuccessfully tried to bring outside culture into Intel.
Intel has an uphill battle in mobile front. This is caused by multiple reasons. Not a really high priority for mobile inside the company at early years, SoC learning-caused delay, no experience in very competitive phone biz, no LTE etc ... I heard from a friend that he is impressed not only by its available cash but also its politics...
What BK needs to do probably is to pick a leader (maybe outsider) for its architecture group. The choice of BK is quite logical. Let's see what is the next step at Intel. Intel is late in mobile but no one can underestimate its power.

I worked with Krzanich for 6 months when we both were at Cray Research - Gallium Arsenide Advanced Products Group, both of us coming from Intel in mid 80s. Brian is sharp, focused, perceptive and talented.
You have no idea how good he really is, and I'd say he is both a brilliant manager, and focused sharp technologist and superb at operations. Low key and all substance.
He gets implicitly that Intel's challenge of the decade is to capture mobile in all forms. And I'd bet he will do that to a level that will exceed expectations.
I would never disparage his education nor talents. You have no idea how good he actually is.
I will remark that degrees from top flight institutions do not always correlate well to actual skills level.
Past a certain level of technical expertise, there is an aspect to pragmatic hands on smarts, analytical skills that is hard to teach.
And Brian is in every way a technologist, hands on and very skilled. In a word he knows yield improvement like few other, and he understands sufficiently the imperatives needed to recapture mobile.
I think the 7-10w Haswell i7's might hint at what might throw ARM cpus for a loop, and you can bet SOC on a chip power envelopes vs compute power, will soon shock many who think Intel won't come back.
Intel's ability to integrate SOC features might give you a feel for what will play out in the next 2 yrs. ARM will begin to feel the heat in more ways than 1.
I wish Brian all the luck, and he will make plenty for himself & for Intel.

By your own words: What happens to a brilliant person who just happened to be born into a poorer family (particularly cash-poor - they may own land that will last forever, but cash flow is low), or in a different part of the country, or with a particular philosophical/religious orientation? They won't go to the "typical" top tier colleges. Does that make them less brilliant?

I'd hire the lawyer with 30 years of experience with expertise in the type of issue I need help with and one who has been successful in that 30 years. sprite0022 we can turn it around and look at failing CEOs and question why their pedigrees did not prevent failure. Some people who went to elite universities do not want to believe that somebody with good instincts from a an average state university can do their job.

I'd say the education is not so much the issue as the ability to get into a more prestigious institution. So perhaps he can't do a Rubik's cube as fast of some of his engineers. Or maybe he was a party animal in high school. who knows. In the end, it really doesn't matter about his education. One thing's for sure.. .He knows how to work himself up the ladder...

We know nothing of the personal circumstances that made him go to SJSU. There are serious studies which demonstrate unambiguously that the achievement of ambitious students is interdependent of their educational pedigree. I forget the name of the authors, but the study compared students who were admitted and attended an Ivy League school to those that were admitted but chose not to attend for whatever reason. The statistically rigorous conclusion? The economic value added of an Ivy League education is near zero, unless you are a minority student from a disadvantaged background.
Regardless of whatever the circumstances were, does anyone seriously think that it matters? Management skills are quite orthogonal to technical skills. If there is one thing to worry about is that in the past BK has demonstrated scant evidence of vision. Is he another Barret - all execution, even if the goal is to pump out sh*t at a record pace?

The new CEO had to make a presentation to the Intel board about what he would do to get the job. So it's not so fast to be doing a re-org given he didn't have to do anything to get oriented in the not-new company.
What we have NOT seen yet is any solid indication of how he is going to speed up Intel's slooow traction in mobile. Appointing Mike Bell to a new mobile group means nothing to me. Mike Bell was heading up Intel's mobile business previously.
The significant shoes have yet to fall.

Interesting! If that's true, then his almost immediate taking action (even if no significant shoes have dropped yet) means that the board is accutely aware that things need to change - fast. Intel has traditionally been a company that sticks to long-term strategies, and this move suggests that the board must be accutely aware of the dire outlook for the current strategy. Curious to see what the next steps in his plan are.

wow, i bet lot's of angry academic losers here.
one reason why losers love engineering or have to go to engineering is there is no need for board test to get a engineer license.
cheap and easy entrance, work up the ladder through everything you can imagine.
world is flat again.

Let's see, most of the big smartphone companies use version of ARM with some customization, I cannot imagine even one of them to switch to Intel processor.
The echo system of the Arm is well established and the advantages are such a barrier that Intel new Ceo should rethink of better idea

Well, Samsung is just rumored to use Intel chip in galaxy tab 3. Once it starts to use in tablet, not far away to use in smartphone. And Lenovo also just releases a phone using the same Atom chip, which achieves record benchmark score. I won't write Intel's chance of success in both Smartphone and Tablet.

Harvard? In case these trends are not obvious outside the US, the supposedly premier Ivy League schools have been changing their image in the not-so-recent past. You can find a lot of info on this online.
The acceptance criteria are now heavily weighted to foreign students -- those whose governments pay the fees in full that is -- and disadvantaged students from within the US. Don't take my word for it. Look it up yourselves. I wouldn't be surprised if their reputation will be affected by these trends, in due course. Certainly my own perception has been.
The other side of the coin is that even "low-ranked" universities produce top-notch students, as far as I've been able to witness. College degrees are never trivial to obtain, especially in difficult majors.

the problem is Intel has no clue, and has not had a clue, what the next market trends is, outside of x86 for the Windows PC. They have tried so many times with wrong headed initiatives. Putting hard nose operations people in charge only cemented this obdurate wrong headedness.

It is very difficult to leave behind a cash cow strategy. It is even more difficult to KNOW where markets are driving technology. The landscape is littered with many an intelligent bet gone sour.
Intel has done better than most in not getting too far behind the curve.

kind of hard to shake things up when you are from the inside, just asked the water in the jar. Intel still stucks on mfg of CPUs, hence this is where the mindset is at. They think only they know how to do it. Hee hee.

some losers don't understand the difference between top college and SJSU. One major difference is top school will have some focus/trainning on future tech/trend, help student build the vision to explore new front. such as stanford's SLAC, caltech's Jet propulsion lab etc.
SJSU 's main focus is train student to make a living.
it's not surprising SJSU graduate generates plenty of wrong headed initiatives. It's like you are expecting a high school graduate to teach you college math.

@sprite0022--Again, this is ridiculous. He earned his degree in 1982 (I can promise you there was no course on EUV lithography then). Since then, he has been helping to build/run the world's biggest semiconductor company. Nothing he learned or didn't learn at San Jose State in the late 70s and early 80s is relevant. 30 years of experience is what matters.

what is vision?
for example, to be a US president it need vision, decent understanding of history, global politics etc.
most US president have ivy league background which has the enviorment and resources to build such kind of vision. although they become president maybe 30 years after graduation the foundation is still critical...

nope, I think it also depend on the type of industry, very innovative or stable.
for company like pepsi a mba will work, for google it need a professional otherwise it will get losted very fast. imagine MS without bill gates? win8 almost killed it already.

a harvard drop-out, where he got his vision already, and also prove he got the IQ at least.
ballmer also from harvard,
let's try this one, how many successful start-ups (+ 1 billion revenue)'s founder are graduated from 50+ ranked colleges?
I bet I will find more than you do.

I think all of you who feel offended if your IQ might be lower and graduated from a tier 3 college should take it easy.
this is life, someone does have something better than you. you can be jealous, angry, but it's not cool if you try to fool yourself or others.
just like if you get a 200lbs wife, don't try to tell people it give you the same experience as angelina jolie.
It won't be the same, as we all know...

This thread has gone way off topic and needs to be stopped. I wish people would simply comment on the main theme of an article instead of spewing out all kinds of irrelevant stuff. Yes, I believe in free speech and everything but we have to draw the line somewhere.
Moderator - please help!

Intel has had its share of missteps, but is probably the only Silicon Valley pioneer (along with Apple) that is still at the forefront of its core technology - witness the state of HP, Sun, Fairchild (remember them). Intel sets the industry benchmark for advancing Semi fabrication technology (Samsung and TSMC still play "follow the leader")and shows the world that the US is still capable of world class manufacturing. I sincerely hope they are successful in this transition.

Bachelors in chemistry from SJSU ? That's it, I am dumping me stock. Intel founders were from MIT, Caltech and Berkeley. There has been a steady decline since Andy Grove in the quality of Intel CEOs (Otellini and Barrett were miserable failures). Google, Microsoft, Broadcom, Qualcomm have CEOs from the top schools. This guy is most likely not a genius and must have used other techniques to rise up.

one more interesting fact is in general Stanford graduate don't have trouble in hiring SJSU graduate to work together but not vice versa.
just like ugly girls don't want to hangout with pretty ones.
so we will observe a downward spiral at intel with more and more SJSU/ community college/ high school diplomas occupying top positions. intel will be transformed to a low tech sth eventually.

I invented a CPU cooler - 3 times better than best - better than water. Intel have major CPU cooling problems - "Intel's microprocessors were generating so much heat that they were melting" (iht.com) - try to talk to them - they send my communications to my competitor & will not talk to me.

Winners of major 'Corporate Social Responsibility' awardS!!!

Huh!!!!

When did RICO get repealed?"

INVENTORS - DO NOT TRUST INTEL!!!

BTW, I have the evidence - my competitor gave it to me.

BBTW, I am prepared to apologise to Intel if;

• They can show that the actions were those of a single individual in the company, acting outside corporate policy, and: